Why BlackBerry Is Big on Malaysia

BlackBerry 's unveiling Wednesday of its Z30, which marks the company’s foray into large-screen smartphones, was nearly overshadowed by the buzz around the company’s move to launch it in Malaysia first.

The reason for planting its flag there? Malaysia has a 137% mobile penetration rate. That is equivalent to one individual owning 1.3 phones in a country of 28 million people.

And BlackBerry is keen to keep its fans in Southeast Asia happy. BlackBerry’s market share was long overtaken by Android and Apple in the U.S., but in Southeast Asia, it still enjoys its greatest smartphone market presence.

In Indonesia, BlackBerry still occupies the No. 1 position, and is ranked as the No. 3 supplier in Malaysia, after Apple Inc. and Samsung Electronics Co., according to IDC data.

Malaysia’s smartphone demand and mobile penetration rate has surged since the beginning of the year, owing to a government initiative called Youth Communication Package, that is aimed at lifting mobile phone usage among young Malaysians. Under the program, a 200 ringgit ($62) cash rebate is offered for the purchase of a smartphone for Malaysians aged between 21 and 30, and are earning below 3,000 ringgit ($929) a month.

Thanks to this program, smartphone shipments accounted for nearly 50% of total mobile phone shipments in the first six months this year, compared with 32% in the same period a year earlier, according to research firm IDC.

There is also more demand for full-screen smartphones in Malaysia compared with Indonesia, said Damian Tay, BlackBerry Asia Pacific’s director for product management. The Z30 has a five-inch screen, making it one of the larger on the market. Ease of shipping BlackBerry devices to Malaysia was another important factor too, he said.

“Blackberry is a late comer to this [large-screen mobile devices] sector but I don’t think it is too late for them,” said Daniel Pang, an analyst at IDC said.

“Phablet devices have caught on quickly in Asia Pacific as consumers today want a single device that covers communication and productivity that is light and small enough to take with them wherever they go,” Mr. Pang said. IDC defines phablet devices as having a screen size of five inches to under seven inches.

It is early days yet of course but it will be interesting to see how the Z30 fares in the race for dominance in the phablet market in Southeast Asia.